LONDON – News surfaced this week that Aeroflot purchased 10 Boeing 777s from an Irish lessor. What is Aeroflot trying to achieve from this?
The 10 Boeing 777-300ERs already possessed Aeroflot but were under leasing agreements.
However, due to the way sanctions have operated in the wake of the Ukraine Crisis, the Russian carrier is purchasing the jets not to strand them anymore.
Aeroflot’s Take…
In a statement submitted to outlet TASS, Aeroflot said the following on the purchase:
“Aeroflot has bought out and acquired ownership of 10 Boeing 777-300ER long-haul aircraft, which have been under financial lease from an Irish leasing company since 2013 and 2014”.
“Aeroflot will continue to work on further implementation of transactions for the purchase of aircraft in order to maintain the current fleet of foreign-made aircraft in its own operation and expand the possibility of their operation.”
“This approach also confirms the reliability of Aeroflot as a counterparty that responsibly fulfills its contractual obligations.”
Was This Purchase Legal?
In short, yes. In April 2022, the European Union implemented an amendment to its list of Russian-based sanctions that allowed lessors to sell aircraft in Russia.
The amendments stated that such payments can be accepted as long as the financial leases were concluded before February 26, 2022.
As Aeroflot has had the aircraft since 2013-14, this means that it falls within the criteria set out by the amendment.
Aeroflot has done the same already. Back in May 2022, the carrier bought out eight Airbus A330 aircraft from foreign lessors.
What Is Aeroflot’s Thinking?
Airspace bans implemented as a result of sanctions do offer a level of confusion into why Aeroflot made this purchase in the first place.
On the international stage, Aeroflot has already had some trouble operating such flights, with the most notable being the detained A330 aircraft in Colombo back in June.
Whilst the ban was later lifted, such a lift was probably due to the purchases being made by the Russian carrier.
With this in mind, it does make sense that Aeroflot is buying out the aircraft leases.
In the context of Sri Lanka, Aeroflot purchasing such aircraft means that no lessors can place court orders on the leased aircraft, enabling them to operate internationally with no problems.
However, Aeroflot’s international route network continues to be limited due to such airspace bans, which is why the following question is needed:
Why 10 777s?
Now, there could very well be an ulterior motive behind this purchase. So, as a disclaimer, this is purely speculative at this point, but it is a topic that needs to be raised: Spare parts.
With sanctions and enforcement actions being taken out by the West, this immediately limits the number of spare parts that Aeroflot can get its hands on.
For the Russian carrier and others operating within the country, this is beginning to become a major problem, with the government having to intervene.
In June, it was announced that China was going to supply Russia with spare parts for aircraft that are already grounded due to heavy maintenance issues.
However, as there are sanctions on the Iranians and some parts of Chinese trade by world powers, even this supply will still be limited.
It could very well be suggested that this is another reason for direct purchasing power. It enables access to spare parts.
What Will This All Mean?
Aeroflot could be purchasing the aircraft outright so then they don’t have as much drama on the international routes they serve, or they could very well be using them for spare parts.
The statement from the airline doesn’t really give that much of an indicator of the reasoning for purchase, other than them being a responsible carrier that “fulfills its contractual obligations”.
One thing that could be interesting is whether these 777s will be used on domestic Russian routes, especially as the demand for travel in that area is on the rise.
In the meantime, all eyes will be on Aeroflot to see how they are going to utilize these aircraft and whether it is part of an overall plan to remain operational and profitable.
